How PhonePe’s wealth management arm has boosted security framework to safeguard data

Digitalisation has rapidly transformed the financial sector, changing how client data is stored, processed and shared. This shift not only offers immense opportunities for efficiency and client service but also increases vulnerability to cyber threats, making cybersecurity a critical concern.

Wealth management firms - an investment advisory service that provides financial management and wealth advisory services to clients - as custodians of highly sensitive financial data, are prime targets for cyber criminals. Their unique vulnerabilities, such as handling large financial transactions and personal client data, underscore the need for tailored cybersecurity measures.

Share.Market, PhonePe’s wealth management platform, is using a strong cyber strategy to protect sensitive client information against cyber threats. In an interview with TechCircle, Himanshu Sahu, Head of Engineering, Share.Market highlights how the company is working towards protecting user data and trust, the relevance of cybersecurity, and infrastructure resilience.

Securing client data

According to Sahu, protecting sensitive client information is not just a technical requirement but a central component of maintaining trust and integrity in wealth management services.

This year, the company is prioritising three core areas in technology - proactive threat detection, enhanced data protection, and Cloud Security Posture Management (CSPM).

“We are prioritising early detection mechanisms to combat increasingly sophisticated phishing and social engineering attacks, especially within the financial sector. We are enhancing encryption, access controls, and data governance to secure financial data and transactional integrity, minimising vulnerabilities and ensuring regulatory compliance.

Given our reliance on cloud infrastructure, CSPM is critical for continuous monitoring, real-time remediation of misconfigurations, and adherence to compliance frameworks. Share.Market also utilises PhonePe’s Fraud & Risk Assessment (FRA) system and broader risk evaluations to adapt to the evolving threat landscape.

Cybersecurity, according to Sahu, has become a key brand differentiator for Capital markets. In today’s digital-first capital markets, especially as SEBI continues to strengthen its cybersecurity framework, signalling the importance of a proactive security posture. “Today, digital trust has become paramount; cybersecurity is no longer just a backend function—it’s a strategic function for differentiation, growth, and customer loyalty,” he said.

In line with that, the company is focusing on building long-term investor confidence by aligning with SEBI's regulatory expectations, investing in advanced security measures, and transparently communicating these efforts to attract and retain users.

AI-led fraud detection

Sahu also sheds light on the fact that brokers who invest in advanced security measures and transparently communicate their efforts can attract and retain users who prioritise the safety of their investments and personal data.

In this context, AI-led fraud detection and threat intelligence are becoming essential tools for brokers to minimise risk exposure and protect investor interests in real-time. For example, AI and machine learning algorithms can analyse vast amounts of transactional data in real-time to identify patterns and anomalies that may indicate fraudulent activity. This allows for the immediate flagging of suspicious transactions, significantly reducing the window of opportunity for fraudsters.

AI-powered systems can predict potential risks by analysing market trends and even news sentiment. This enables brokers to take pre-emptive measures to reduce their risk and protect their clients' assets.

Integrating AI across security infrastructure, brokers can move from reactive defense to intelligent, predictive protection, reducing risk exposure while enhancing investor trust and platform integrity.

He explains how the company takes a comprehensive approach, combining technology safeguards with user empowerment. “By inheriting a strong focus on security as part of the PhonePe ecosystem, we focus on secure infrastructure, real-time monitoring, investor education, and risk-aware trading features.

"We employ measures like multi-factor authentication as well as secure transactions. Share.Market actively promotes investor education by offering actionable insights based on risk appetite and provides resources and alerts to foster informed decision-making," he said. Features like "Market Order with Protection" (MOP) safeguard investors from significant price volatility.

Hyper-personalisation matters

Sahu notes the importance of fortifying digital security around KYC processes, third-party risk, and incident readiness, especially given recent data breaches. Multi-layered identity verification systems, including biometric authentication and real-time detection, are being implemented. Cloud and AI technologies are used to enable smart investing experiences and drive business outcomes.

Share.Market recently launched WealthBaskets, quantitative research-based collections of stocks or ETFs, simplifying stock selection and increasing investor participation. Real-time market intelligence is embedded directly into the trading interface, empowering quicker, more informed decisions.

Sahu said that the company is refining the user interface for simplicity and intuitiveness, leveraging data science and machine learning to create personalised user journeys with customised educational content and investment insights.

Looking ahead, the company is focusing on AI-driven personalisation, resilience and platform scalability, and next-generation security, including AI and ML for portfolio diversification, risk identification, and proactive investment recommendations, as well as a cloud-native, microservices-based architecture for high availability and rapid feature deployment.